Powel v. Commissioner
United States Board of Tax Appeals
The petitioner, as a stockholder of the American Telephone and Telegraph Company and the MissouriPacific Railroad Company, in 1929 received "rights" to subscribe for bonds of the issuing corporations convertible into shares of a new issue of stock at stated prices. Held that the market value of the subscription rights does not constitute taxable income.
1Opinion of the Court
OPINION.
ARUndell :
The respondent determined a deficiency of $477.40 in income tax for 1929. The error alleged is the imposition of a tax on the value of certain “ rights ” to subscribe for bonds convertible into stock of the issuing corporations.
In 1929 the American Telephone and Telegraph Company, pursuant to authority given it by its stockholders, increased its capital stock and issued ten-year convertible 4y2 per cent gold debenture bonds, dated July 1, 1929. The authorizations provided for the issuance to stockholders of record May 10, 1929, of one “ right ” to subscribe for the bonds for…
2Cases cited2 opinions
- Eisner, Internal Revenue Collector v. MacOmberSupreme Court of the United States · 1919
- Miles v. Safe Deposit & Trust Co. of BaltimoreSupreme Court of the United States · 1922
3Cited by14 opinions
- Clark v. CommissionerUnited States Board of Tax Appeals · 1933
- White v. CommissionerUnited States Board of Tax Appeals · 1934
- Connelly v. CommissionerUnited States Board of Tax Appeals · 1934
- Bartlett v. CommissionerUnited States Board of Tax Appeals · 1933
- Bartlett v. CommissionerUnited States Board of Tax Appeals · 1933
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